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Q You have been tracking the fares charged for a round-trip ticket between two of your favorite locations (e.g. between Las Vegas and Chicago). You were to keep your departure and return dates constant in order to observe how fares change over time. How can you explain the constant variation in fares? What pricing strategies does United Airlines apply? Discuss Make an initial posting showing the overall price development of the fares you've been tracking for the past 1-2 weeks. Simply posting the prices won't do the trick, though; you are expected to provide a short explanation of your observations and analyze possible variables affecting the variations in prices.

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Like every other airline company, United Airlines changes their fares based on the demand they see or rather foresee. Second degree price discrimination is used by United Airlines as the pricing strategy. This means the price variation will depend on the period of booking the ticket. If you book the ticket one week or one month earlier then the price of the ticket will be low and if you book the ticket a day before flying will have to pay a lot more. I experienced this phenomenon. When I bought a ticket early I paid much lesser and then when I checked just before the day of my departure the prices went up very high.